Car financing



Gutmackem said:
But how would that get the price down which they are advertising it for?
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They get commission on the finance, so sometimes they'll sweeten the deal to sell the finance. I know at some places, they'll increase the trade in value if you take their finance, or extended warranty etc. Or some places, if the interest rate on the finance is too high, they'll reduce the sale price a bit so the monthly payments come in as low as a bank's lower rates, if that makes sense.

What some people will do is say aye to everything, then use cooling off rights to cancel the warranty and settle the finance early (assuming the finance company allow this without charge).

Pretend you've secured a loan at 3%. If the car dealer is offering something like 10% - tell them you will only pay whatever the payment would be at 3% - lots of times they'll just reduce the price so the payments at 10% will be the same as the original price at 3% or as close as they can get. Then you will have a smaller amount to settle with the finance company. If they offer you an extended warranty, refuse, if they offer you it cheaper, accept, on the basis that you'll cancel it later. Often you'll find they'll change the sale price or increase the trade in price and once you cancel the warranty it's too late for them to change them back.
 
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